Seed technology and production system comparisons – South African subsistence /
smallholder farmers
An internal report to the University of Missouri led
“Creating a Community of Practise in KwaZulu-Natal”
a Templeton Foundation supported project
By
Marnus Gouse
Department of Agricultural Economics, Extension and Rural Development,
University of Pretoria
August 2014
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1
Background
South African maize farmers have been planting genetically modified insect resistant (Bt) yellow
maize since 1998 and Bt white maize since 2001. Herbicide tolerant (HT) maize was released in
2003/04 and Stacked seed (with both Bt and HT, locally known as BR seed) for the 2007/08
production season. When Bt white maize was commercially released in 2001 the technology was
introduced to smallholder farmers and South Africa became the first country in the world where a GM
subsistence crop (maize) is produced by actual subsistence farmers. Though adoption of GM maize by
South African large-scale commercial farmers has been remarkable (in 2013 85% of SA’s maize area
was planted to GM maize), adoption of GM maize by smallholder farmers is still limited. Gouse,
Kirsten and Van Der Walt (2008), based on seed company information, seed sales and assumptions
regarding seed quantity, bag sizes and seeding rates found that approximately 10 500 smallholder
maize farmers or approximately 23% of the estimated 46 500 smallholder farmers that regularly buy
hybrid seed from the three largest maize seed companies, planted GM maize seed in 2007/08. Though
it is believed that adoption has increased somewhat since 2008, in a country with an estimated 240
000 small-scale farmers (surplus producing) and close to 2 million subsistence farmers, it is clear that
the majority of smallholders are not planting GM maize.
It can be expected that with the current commercialised GM technologies, insect resistance and
herbicide tolerance, and due to smallholder farmers’ maize production motivations - more focussed on
subsistence, taste and quality (Gouse, 2012b), GM maize adoption levels by smallholders will not
reach those observed for commercial farmers. With cognisance of the fact that the current GM
technologies do not appeal to or is needed by all smallholder farmers in South Africa, it is however
believed that with improved support services, more SA smallholder farmers can benefit from the
advantages (see Gouse, Piesse & Thirtle, 2006; Gouse, Piesse, Thirtle & Poulton, 2009; and Gouse,
2012a) of the current GM technologies.
This paper compares and quantifies the farm-level impacts of GM maize adoption by smallholder
farmers by comparing seed type and production system specific production budgets and farm-level
profitability.
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Data and methodology
The study draws on smallholder data collected from mainly farmers in the Hlabisa and
Simdlangentsha areas of KwaZulu-Natal (KZN), for the 2005/06, 2006/07, 2007/08 and 2009/10
maize production seasons. Gouse (2012b) compiled maize enterprise production budgets for farmers
planting a range of seed types, including conventional hybrid and GM maize seed for these four
seasons (see first Gouse report to Templeton project). Even though it is possible to identify certain
costs and advantages of the different seed/technology types from these seasonal budgets, relatively
small seed specific sample sizes, considerable variation within seed specific sub-sample groups as
well as variation in a number of ‘other’ variables / inputs, result in some blurring of these technology
specific effects. For this reason, and in order to clearly present and compare the differences in the
costs and returns of different seed types, one set of standardised maize production budgets are
compiled based on the comprehensive production data collected for the mentioned four seasons as
well as research in the preceding four seasons (2001/02 to 2004/05) and industry data.
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3
Assumptions and discussion
The standardised seed type and production system specific budgets are presented in Table 2.
Production practises and their resulting expenditure requirements (inputs) and outputs (yield) are
compared for:
•
•
•
•
•
•
•
•
Farm-saved seed with minimal inputs
Older conventional hybrid seed with increased inputs
New conventional hybrid seed with increased inputs but not herbicide, i.e. manual weeding
Bt seed with manual weeding
New conventional hybrid seed with a selective herbicide
Bt seed with a selective herbicide
HT seed with broad spectrum herbicide
‘Stacked’ (BR) seed with broad spectrum herbicide
The individual inputs and their technology and production system specific quantities and costs are
discussed next.
3.1 Seed
Farm-saved, also known as traditional seed in the South African smallholder context, can be any seed
that has not been bought. It can be grain saved from previous years’ bought hybrid maize, open
pollinated varieties, grain from maize seed distributed by government or grain selected for colour or
taste by the farmer or other members of the community. For the financial comparison, saved seed is
priced at the theoretical price the farmer would have been able to sell the quantity of grain for.
A seeding rate of 18 kg per hectare is assumed for all seed types based on survey data as well as KZN
Department of Agriculture extension officer recommendations. This is quite high for dryland maize
production but in line with commercial farmer seed use in the higher rainfall dryland maize
production areas of Mpumalanga and KZN.
Seed prices are compared to the newer conventional hybrid as the benchmark in Table 1. PAN 6043 is
an older fairly drought tolerant conventional variety still planted by smallholder farmers in KZN and
Swaziland. Monsanto’s CRN 3505 is a newer conventional hybrid which is also the isoline for DKC
7815 Bt, DKC 7835 HT and DKC 7845 BR (stacked). From Table 1 it clear that the older
conventional hybrid seed is considerably less expensive than the newer conventional hybrid and the
price for BR is close to the price sum of Bt and HT seed.
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Table 1: Seed price in ZAR per 1 000 seeds (2007/08)
Old
conventional
hybrid
(PAN 6043)
New
conventional
hybrid
(CRN 3505)
Bt
(DKC 7815)
HT
(DKC 7835)
BR
(DKC 7845)
Seed price
9.93
16.02
20.59
20.73
25.87
Price difference to new
conventional hybrid
-38%
0%
29%
29%
61%
Source: Industry published seed prices (Gouse, 2012b)
•
•
•
Over the seven year period 2003/04 to 2009/10, Bt maize has been between 25 and 30 percent
more expensive than the conventional isoline.
For the six years 2004/05 to 2009/10, HT seed was 33% more expensive for the first three
years, 29% more expensive for 2007 and 2008 and 24% for 2009/10.
BR maize was 61, 54 and 45 percent more expensive than the conventional isoline hybrid for
2007/08 to 2009/10.
3.2 Fertiliser
The vast majority of smallholders surveyed in the Hlabisa area used considerably less fertiliser than
what is required or recommended and in the nine year study period, very few even mentioned lime
application. Though some farmers in Simdlangentsha also do apply a limited quantity of topdressing
later in the season, farmers in Hlabisa only apply basal fertiliser. For this comparison the average
fertiliser quantity for the 2007/08 season is used for hybrid maize while farmers used little (if any)
chemical fertiliser on saved seed plots. Some farmers do make use of kraal manure.
3.3 Herbicide
The use of herbicide by smallholder farmers is still minimal and before HT seed was released, and
farmers trained in the use of herbicides on demonstration plots planted by Monsanto, few actually
knew how to use herbicides. There are however regions in South Africa where the Agricultural
Research Council has made great progress in teaching farmers about selective herbicides. In these
areas farmers do make use of herbicides albeit not always in an optimal manner.
The production practise comparisons present a conventional hybrid and Bt maize ‘with and without
herbicide’ scenario. While HT and BR farmers make use of a single post emergent broad spectrum
herbicide (glyphosate) application, the conventional and Bt maize planting farmers who do use
herbicide, make use of two selective herbicide applications.
For this comparison it is assumed that the two selective herbicide applications control weeds just as
effective as the single post-emergent glyphosate application and no additional manual weeding is
required. This is however in contrast with findings in Simdlangentsha where conventional maize
planting smallholders using selective herbicides have to do some additional manual weeding in order
to control mainly perennial grasses.
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3.4 Insecticide
Gouse (2012b) showed that the insecticide saving benefit of Bt maize for smallholder farmers in KZN
is minimal in seasons with limited borer infestations. While it can be expected that farmers will
purchase and apply more insecticide in seasons with higher stem borer pressure, the use of
insecticides by smallholders on maize is considerably lower than that for instance observed in cotton
production. Some farmers also indicated that if they do observe borer and borer damage on
conventional maize, they make use of ash or washing detergents instead of insecticide granules or
sprays.
For this comparison, an average to slightly higher than average borer infestation level is assumed and
non-Bt and higher input using farmers make use of one pyrethroid application to control borers, as
was observed in the Simdlangentsha area.
3.5 Family labour
In order to determine the impact of Bt and HT maize adoption on labour use, Gouse (2012b) collected
detailed maize production activity specific labour data for the 2005/06 to 2007/08 and 2009/10
seasons. It is clear from the above discussion on insecticide application that Bt adoption had very little
impact on saving on insecticides and for the standardised per hectare budget comparisons only a
single day of insecticide application for two people is assumed (based on farmer data).
Over the four seasons some farmers made use of mechanised land preparation but the vast majority of
farmers in both Hlabisa and Simdlangentsha made use of manual family labour for maize production
activities. There has been some variation over the four seasons in the way farmers did land
preparation with farmer decisions influenced by the availability of government tractors or oxen teams.
It also seemed as if, with the new HT technology, farmers searched for the ‘best’ (cost and labour
effective) land preparation and planting method. Starting in 2003, Monsanto presented farmers’ days
and demonstrations of minimum or no-till practises known as planting-without-ploughing (PWP).
These practises had already previously been introduced in smallholder production areas by the
Agricultural Research Council in order to limit tillage related soil erosion (Gouse, Piesse and Thirtle,
2006), but had not widely been adopted due to its labour intensive nature (compared with animal
traction and tractor ploughing), because farmers generally struggle to afford and use selective
herbicides and (more recently) partly due to government’s mechanisation programmes. However, with
the use of HT technology with a post emergent broad-spectrum herbicide it appears farmers have
decided that the most cost and labour effective way to plant is to just ‘open plant and close a planting
station’ using a hoe and no ploughing or furrow opening is done. This is in line with the PWP
practises (Ukutshala ungalimanga) recommended by the Agricultural Research Council.
Similar to the other maize production inputs a standardised labour use budget was compiled for the
different seed technologies and production approaches based on the labour use findings of the four
study seasons. Family labour was priced at R40 / day which is considerably lower than the South
African minimum wage but based on actual hired labour payments in 2007/08. For these comparisons
it is assumed that all the maize production labour is performed manually by family members and or
hired labour and there is no mechanised land preparation.
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Based on the detailed data collected over the four season period, a number of other labour
assumptions are made for the standardised comparisons:
•
•
•
•
•
•
While saved seed, HT and BR farmers make use of PWP, other hybrid maize and Bt seed
planting farmers make use of a combination of ploughing with an animal drawn implement to
control weeds and / or preparing a seed bed and then planting by hand or animal drawn
planter.
Herbicide application requires two people for two days per hectare for spraying and fetching
water
Insecticide application requires two people for one day per hectare
Farmers who apply herbicides do not do manual weeding
One hectare of maize requires 22 (7 hour) person days for weeding
One person harvests maize cobs equal to 218 kg of grain per day.
3.6 Yields
Production levels per hectare were assumed to fall in the range observed in the 2007/08 season when a
reasonable rainfall quantity and seasonal distribution was enjoyed. Observed yields in the three other
seasons were lower due to adverse rainfall conditions.
•
•
Bt maize, compared to the conventional isoline with same production system, is assumed to
have a 12% yield advantage (borer damage limitation) based on the six season average
reported by Gouse (2012a).
Maize produced with the use of herbicide is assumed to have a 10% yield advantage (weed
damage limitation) over varieties where weeds are controlled by hand.
3.7 Grain price
Due to adverse rainfall conditions in especially 2005/06 and 2006/07 few farmers sold any grain but
with better rainfall and resulting higher yields in 2007/08 and 2009/10 (to some extent) most farmers
sold a couple of bags of grain in Hlabisa and Simdlangentsha. The main point of sale is either at
‘pension days’, when Government welfare grants are paid out for old age pension and child and
disability grants, or just in the community to people who do not produce maize.
The recorded grain price for maize sold in the community is at R3 000 / ton considerably higher than
the ‘commercial farmer price’ which for this analysis is take as the average of the South African
Futures Exchange (SAFEX) price for 2007/08 minus the transport differential to the closest SAFEX
delivery point which was assumed to be Paulpietersburg (R1 800 – R264 = R1536). The higher
community grain price is linked to the fact that the grain is available close to home (not necessary to
travel to town and carry maize meal to home), cash is available due to the ‘pension days’, the
community is buying from one another and also the perception that maize meal made from locally
bought grain is more healthy. The is considerable truth in this perception as commercially milled
maize meal contains less oils and proteins as the germ is removed to, amongst others, increase the
shelve-life of the maize meal.
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The main problem of the local market is however that it is limited and insufficient and ineffective
storage facilities result in disparity in demand and supply through the season.
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Findings
The standardised production budgets are presented in Table 2 and the results are largely selfexplanatory. It is quite clear that when only direct inputs are considered the increased cost of Bt, HT
and especially BR seed coupled with expenditure on herbicide, result in a higher per hectare input
expenditure requirement, i.e. cash input. However, when the opportunity cost of family and or
possible expenditure on hired labour is taken into consideration, BR and HT maize has a cost saving
advantage in that substantially less labour is required for land preparation and planting as well as for
weed control.
In rural areas like Hlabisa in KZN where the majority of households are headed by female farmers
due to migration of males to urban areas in search of employment and where a large percentage of
household heads are elderly with little education, there is substantial pressure on labour supply. This
situation is exacerbated by a tragically high HIV/Aids prevalence. Many elderly farmers planting
conventional maize indicated that they cannot effectively control weeds due to time and energy
constraints.
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Table 2: Comparison of standardised seed and production practise specific maize production budgets
Saved seed
Old hybrid
(Pan 6043)
no
no
Unit
Conventional
hybrid
(CRN 3505)
no
Bt
(DKC 7815)
Herbicide use
Inputs
Seed quantity
Seed exp.
Fertiliser quantity
Fertiliser exp.
Herbicide exp.
Insecticide exp.
Hired services
kg
ZAR
kg
ZAR
ZAR
ZAR
ZAR
18
54
100
370
-
18
486
185
685
-
18
836
185
685
120
-
18
1 058
185
685
-
Total value of family labour applied
@ R40 / day
Land preparation and planting
Herbicide application
Insecticide application
Manual weeding
Harvesting
ZAR
ZAR
ZAR
ZAR
ZAR
ZAR
1 344
280
880
184
1 791
580
880
331
A: Total exp. on inputs
B: Total exp. without family labour
ZAR
ZAR
1 768
424
Output
Output quantity
Value of output at community sales
price of R150/50kg
Value of output at commercial price
of R90/50kg minus transport diff.
Gross margins
A: Including all expenditures @
community price
B: Excluding family labour @
community price
Including all expenditures @
commercial grain price
no
Conventional
hybrid
(CRN 3505)
yes
Bt
(DKC 7815)
HT
(DKC 7835)
BR
(DKC 7845)
yes
yes
yes
18
1 058
185
685
210
-
18
836
185
685
210
120
-
18
1 290
185
685
121
-
18
1 075
185
685
121
120
-
1 907
580
80
880
367
1 871
580
880
411
1 384
580
320
80
404
1 348
580
320
448
924
280
160
80
404
888
280
160
448
2 962
1 171
3 548
1 640
3 615
1 743
3 234
1 850
3 301
1 953
2 925
2 000
2 984
2 096
800
1 800
2 000
2 240
2 200
2 440
2 200
2 440
ZAR
2 400
5 400
6 000
6 720
6 600
7 320
6 600
7 320
ZAR
1 176
2 976
3 336
3 768
3 696
4 128
3 696
4 128
ZAR
632
2 438
2 452
3 105
3 366
4 019
3 675
4 336
ZAR
1 976
4 229
4 360
4 977
4 750
5 367
4 600
5 224
ZAR
-592
14
-212
153
462
827
771
1 144
kg
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-
Figure 1 visually presents the main outcomes from the comparison:
•
•
•
Despite higher input expenditure BR and Bt maize with herbicide are the most profitable even
when family labour is not included as a cost due to the yield benefit of improved pest (borer and
weed) management
Labour demand for land preparation and weeding is substantially lower for farmers making use
of no-till practises (PWP) and herbicide.
Labour productivity (kg grain produced per labour day) is substantially higher for BR but also
for HT compared to Bt with herbicide (that has a higher gross margin) due to the labour saving
impact of PWP in combination with a broad spectrum herbicide.
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5
Conclusion
This assessment drew on data collected over a four season period from smallholder farmers in the
Hlabisa and Simdlangentsha regions of KwaZulu-Natal, to compile standardised production budgets for
different seed technologies and production practises. Though this approach in a sense assumes a perfect
world where only the quantity and price levels of inputs of interest vary, it is useful to clearly identify
and compare the potential farm-level impacts of GM maize under typical smallholder production
conditions.
The comparisons show that HT and BR maize produced under a minimum / no-till production system
with a broad spectrum herbicide holds great potential for smallholder farmers due to improved weed
control and especially its labour saving advantage. It seems as if smallholder farmers have also
observed the advantages of the HT technology, compared to Bt alone, as in 2012 50% of GM seed sold
to smallholders in KwaZulu-Natal, Mpumalanga and the Eastern Cape was HT and 42% was BR.
A plethora of researchers studying African agriculture have, over the last forty to fifty years identified
the labour demand bottleneck during the crucial land preparation, planting and weeding time as a
crippling hindrance to crop yield and production expansion. This seasonal labour shortage is
exacerbated by more recent out-migration to cities in search of employment and a substantial share of
Sub-Saharan Africa’s high potential agricultural land is lying fallow. A technology that can result in
labour saving during the crucial labour demand period, can result in increased time spent on other food
and cash crops and / or expansion of the crop area. It is argued that herbicide tolerance holds substantial
potential for African farmers due to the labour saving impact combined with the yield improvement that
can be expected when weeds are controlled effectively. However, adoption of herbicides by African
smallholders has been notoriously low due to a number of reasons including issues of affordability,
timely and predictable availability and support through training and information dissemination. It can be
expected that these same factors will limit the adoption and thus the substantial benefits of HT crops.
Development and sustainment of functioning input and output markets require political will and longterm investment in infrastructure and support services.
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